Page 35 - bne_Magazine_October_2017

bne October 2017 Southeast Europe I 35
verge of bankruptcy. It’s a similar situa- tion with radio.” As a result, he forecast, “there could be bargains”.
Dealmaking seems to have started already. Prima TV owner, Cristi Burci, has reportedly agreed to sell his TV channel to Adrian Tomsa, a business partner of Zoltan Teszari, a local inves- tor and the founder of independent broadcaster Digi TV, according to tolo. ro. Prima became insolvent in 2015, and the agreement will come into force only if Prima TV manages to solve the issues related to its insolvency, tolo.ro claims. Following the transaction, Prima TV would use some of Digi 24’s technical equipment.
What’s happening in Romania is hap- pening everywhere. Globally, consump- tion of traditional media has dropped
by 13% over the last seven years even though it still accounts for over two- thirds of consumption, according to media consultancy Zenith Media. The century-old Associated Press (AP) domi- nates all its rivals by a wide margin as the main source of news on Facebook, a recent survey found. It seems traditional journalism still counts; what’s changed is how it is delivered and consumed.
Zenith forecasts that consumption of newspapers, magazines, broadcast tele- vision and radio will continue to decline, while new areas will expand – consump- tion of media via mobile internet is forecast to soar from 19% of the total in 2016 to 26% in 2019.
But this tells only part of the story in Romania, a country whose media scene has been dominated since the 1990s by a handful of powerful businessmen who built up large holdings spanning televi- sion, radio and print.
They include Dan Voiculescu’s Intact Media Group, which started out in 1991 with the founding of Intact Printing House, and now includes major tele- vision stations such as Antena 1 and Antena 3, and high-profile magazines like Gazeta Sporturilor. Adrian Sarbu, nicknamed "The Shogun” was another hugely influential media baron for two decades (and financed the very first
issue of bne, although he never became an investor). Another is Sorin Ovidiu Vantu, former owner of the Realitatea Catavencu media holding.
The main outside player is Central Euro- pean Media Enterprises (CME), though it entered the market in 1995 in partner- ship with Sarbu's Media Pro.
Financially shaky
While most of these men started build- ing up their empires in the 1990s, from the start of the financial crisis in 2008- 2009 the media increasingly politically tinted and – in some cases – inclined
to put out fake news, long before the phenomenon gained prominence in the 2016 US election campaign.
The lack of financial viability of many media outlets helped build up concen- trated ownership in the sector; since few outlets offered strong profitability they
Ioana Avadani, director of the Centre for Independent Journalism in Bucharest, wrote in a comment for the Balkanmedia online platform.
“Unfortunately, the situation of the Romanian media is more or less the same: low or non-existent profits, strong politicisation or political parallelism, if you prefer this term,” Avadani said when contacted by bne for an update on the situation.
“It appears that the market picked up a bit in 2016, with major TV stations get- ting some profit,” she says, adding, how- ever that “the ownership model is still there, with a mention that many local media outlets declined or were let to die as they no longer provide the significant influence they once did”.
Avadani’s comment on the recent upturn in finances is backed up by Bucharest-
“Consumption of newspapers, magazines, broadcast television and radio will continue to decline”
were more attractive to already success- ful businesspeople seeking to increase their political influence than to investors hoping to make some money. This situ- ation was exacerbated with the start of the international economic crisis.
“The financial crisis really played a very big role ... for the [printed] press there was a 70% fall in advertising and they depended on ads; this was not a model based on subs or sales in kiosks,” says Marina Popescu, lead researcher for the Romanian team at the Median Research Centre.
“This coincided with the growth of
the internet, which also happened everywhere but [Romanian media] were in a much more shaky situation than elsewhere.” “The media market has been strongly affected by both the economic crisis and the changes in the media consumption patters triggered by the increasing internet penetration,”
based agency Initiative, which pub- lishes the annual Media Fact Book for Romania. The 2016 edition shows a 6% increase in advertising revenues in 2015 and anticipates that the market grew by a similar amount last year.
“2015 and 2016 bring a confirmation
of the stabilisation of the media market in Romania,” commented Alexandra Olteanu, managing director of Initiative, when launching the report. “Of course, we cannot talk any more about booms such as the ones prior to the crisis,” she says, but still talks of “a constant and healthy rise that can bring more benefits in the media and long term for this market and for the entire marketing and communication industry”.
The report details a 7% rise in televi- sion advertising to €212mn and a 12% hike in online advertising to €57mn in 2015. Radio grew by a more modest 5% and out-of-home (OOH) remained flat,
www.bne.eu